theory, currencyWhat are the characteristics a currency should have in order to be the most useful in the future world of economy? (strict possibility of implementation aside, so some abstraction and “impossible” ideas are welcome) I’m talking about a currency that is as useful in the traditional world, as the web. Has there been any publications on this subject?
Standard good characteristics of currency tend to include the following:
Now in the past portability was mostly related to being able to physically transport the currency from one location to another. I think in the present and future it is more related to being able to make payments between parties that may not be in physical proximity to one another. Although this can be solved with 3rd party systems like Paypal, some would prefer that be a feature of the currency itself. So ideally I should be able to instantly transfer money to a merchant across the country or across the ocean. So it seems we are dealing with some sort of electronic currency.
The issue of scarcity in traditional currency is handled either through trust that a government won’t print excessive amounts of money or through natural means (e.g. there exists a finite amount of gold in the world). A futuristic, electronic currency would either have to rely on a trusted 3rd party, a government, or “built-in” means to ensure scarcity. One example of built-in scarcity would be crypto-currencies that rely on certain mathematical properties of cryptography to ensure scarcity.
Now durability should be no problem for any sensible electronic currency; data can be backed up to one’s heart’s content. Divisibility should also be easy for an electronic currency; if nunits can be represented then it is easy to represent n/2, n/4, etc. units.
Acceptability can be the tough part. A given currency that has all of the other characteristics is more likely to become acceptable, but ultimately it relies on either a government mandate (which does not seem futuristic) or market forces.
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